Foreign Relations of the United States, 1947, Council of Foreign Ministers; Germany and Austria, Volume II

CFM Files: Lot M–88: Box 86: CFM(47) (L) Documents

Report of the Deputies for Austria to the Council of Foreign Ministers ¹

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CFM(47) (L)15

London, 2nd December, 1947.

1. At the 2nd meeting of the Council of Foreign Ministers on 26th November,² the Ministers accepted a proposal by Mr. Bevin that the Report of the Austrian Treaty Commission,³ together with the proposal submitted by the French Delegation in Vienna (CFM/ATC (47)76 of 8th October, 1947—See Annex A⁴), should be referred for detailed examination to Deputies for Austria who should report back to the Council by December 2nd.

2. The Deputies at their meeting on 27th November decided to give immediate consideration to the French proposal since it had not yet been the subject of quadripartite discussion. The French Deputy accordingly elaborated the proposal, introducing certain figures in respect of the three following elements contained in the suggested settlement:—

(a) an apportionment of oil rights both for prospecting and extracting in the form of new concessions and of certain assets in the field of refining and distribution.

(b) a division of the assets of the D.D.S.G.;

(c) an amount fixed in dollars to be paid by Austria through deliveries in kind.

This statement was circulated as CFM 47/L/8 of 27th November, 1947, and is shown at [as] Annex B.

3. Discussion of the French proposal and of the statement of the French Deputy took place at the Deputies’ Meetings on 28th and 29th November and 1st December.

4. The positions of the United Kingdom, Soviet and United States delegations are set out below:—

Position of the United Kingdom Delegation

The U.K. Delegation welcome the French proposals and consider that they provide a general framework for a practical and constructive solution of the problem of German assets in Austria. Moreover, a solution on these lines would appear to obviate the difficulties which have arisen during the prolonged attempt to establish an agreed definition of German assets.

Position of the Soviet Delegation

Under the decisions of the Potsdam Conference former German assets in Eastern Austria became the property of the Soviet Union and former German assets in Western Austria the property of the United Kingdom, the United States, France and other Allied powers.

On the question of German assets in Austria the Soviet Delegation has based, and is basing, itself on the Potsdam decisions. Since, however, the French Delegation has made an attempt to introduce practical proposals on that subject the Soviet Delegation has not refused to study these proposals. But the study of the French proposal undertaken at the previous meetings has yielded quite unsatisfactory results.

Thus the proposal of the French Delegation in the form as it is outlined in the documents presented to the Austrian Treaty Commission and to the Deputies is not, in the opinion of the Soviet Delegation, a just basis for resolving the differences on the question of former German assets in Austria.

Position of the United States Delegation

The U.S. Deputy considered the approach of the French proposal as a practical basis upon which to attempt a reconciliation of existing disagreement regarding German assets in Austria.

5. The Deputies had a brief exchange of views regarding the discussion of the unagreed articles of the Treaty, but did not discuss these articles in detail for lack of time. In addition the U.S. Delegation stated that further discussion would be useless pending a larger measure of agreement on the subject of German assets (Article 35).

Annex B

London, 27th November 1947.

Statement by the French Deputy for Austria (Cherrière)⁵

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CFM(47) (L)8

The French delegation is now able to supply certain particulars in regard to the proposals which it put forward in Vienna on 8th October and which formed the subject of Document CFM/ATC(47)76 of 8th October 1947.

Definite settlement of the problem of German assets in Austria should comprise three elements i.e.:

(a) an apportionment of oil rights both for prospecting and extracting in the form of new concessions;

(b) a division of the holdings of D.D.S.G.;

(c) an amount fixed in dollars to be paid by Austria in the form of products from her current production.

After further study, since the adjournment of the work of the Austrian Control Commission, the French delegation is able to put forward certain figures in respect of each of these elements.

1. Oil.

(a) Extraction. The Soviet Union should receive concessions corresponding to about 50% of the present production of Austria. The duration and general terms should be fixed in accordance with precedents in similar cases.

(b) Prospecting. The Soviet Union should receive about 1/3 of the area of the Zistersdorf oilfields.

(c) Refining. Refineries representing a capacity of 250,000 to 300,000 tons should be transferred to the Soviet Union.

(d) Distribution. The Soviet Union should keep those facilities which she now has in two distributing concerns.

2. D.D.S.G.

Austria should forfeit in favour of the U.S.S.R. all holdings of the D.D.S.G. in Hungary, Roumania and Bulgaria. Further, Austria should transfer to the Allies a certain number of ships in order to compensate the losses suffered by their river fleets during the war through requisitions made for the benefit of the D.D.S.G.

3. Amount in dollars.

The figure envisaged by the French delegation for Eastern Austria is 100,000,000 dollars. Delivery should be spread over ten years, starting from such time as Austria’s minimum needs have been met.

The particulars set out above by the French delegation do not, of course, constitute a fresh proposal, and all the suggestions contained in the document of 8th October, which formed a whole, as indicated in paragraph 17 of this document, still stand particularly those concerning points not dealt with above; this is specially the case as regards the application of Austrian law, arbitration, and the property of United Nations and minority groups.

1. This document was discussed by the Council of Foreign Ministers at its 9th Meeting, December 4; see telegram 6326, Delsec 1521, December 4, from London, p. 747.

   The Deputies for Austria were: United States–Ambassador Dodge; United Kingdom–James Marjoribanks, France–General Cherrière, Soviet Union–N. P. Koktomov.

2. See telegram 6210, Delsec 1504, November 26, from London, p. 733.
3. Document CFM/ATC (47) 77, October 11, 1947, p. 631.
4. The document under reference here is not printed as an annex to this Report; for the text, see p. 620.
5. Statement made at the meeting of the Deputies for Austria, London, November 27, 1947.